Wildfires continued to rage in Los Angeles late Thursday, decimating neighborhoods and raising questions about the future of California’s already troubled property insurance market.

In recent years, insurers like Allstate, American National, The Hartford and State Farm have stopped renewing policies or issuing new policies for California homeowners.

We need to make it incredibly expensive to build in these kinds of environments,’ one expert told The Independent. ‘If the insurance industry refuses to sell policies, maybe people won’t risk it’

The massive fires that have destroyed much of Pacific Palisades and demolished thousands of homes and structures in Los Angeles County threaten an effort to fix California's troubled home insurance market.

The state’s insurance industry was reformed in late 2024 to promote coverage in disaster-prone areas. Tens of billions in fire damage will stress-test the new regime.

The wildfires that destroyed homes in multiple sections of the Los Angeles area will test California’s efforts to stabilize the state’s insurance marketplace after many insurers stopped issuing residential policies due to the high fire risk.

As California grapples with the increasing threat of wildfires, the state's latest insurance plan aims to expand coverage for homeowners while preventing policies from being dropped. However, this well-intentioned strategy comes with a significant downside: a potential 40% increase in insurance premiums,